The success of precision agriculture requires accurate methods for monitoring the state and health of crops. An additional key issue is the availability of accurate and efficient techniques for in-situ determination of soil properties. Reflectance spectroscopy, a technique which can be applied in the laboratory, in the field and from remote observation systems has attracted the attention of scientists in a variety of disciplines. In soil science, this technology as it relates to precision farming is rapidly developing and has triggered new research initiatives. Although a number of studies are available where soil properties have been derived from reflectance spectra the approach involves substantial scaling problems when transferring methods from laboratory spectroscopy to optical sensor systems onboard satellites and aircrafts. The analysis of reflectance images also requires dealing with data having limited signal-to-noise level, being distorted by atmospheric effects and largely affected by bidirectional effects in reflectance distribution. Starting with a short review of the state-of-the-art we present the potential use of reflectance spectroscopy for retrieving useful soil parameters based on several case studies. These studies serve to illustrate the existing limitations for retrieving soil properties over large heterogeneous areas.